Summary
An out-of-state investor purchased office space in Q4 of 2021 that was in poor condition due to years of neglect. With investment properties in Arizona, Pennsylvania, and North Carolina, this investor knew that generating the greatest possible return on investment requires quality local management. He chose to work with Price Commercial Management for property management as they could be on-site to oversee necessary renovations and upgrades and work closely with Price Commercial Properties to lease the space when it became available.
The Property
The Truist Building (formerly SunTrust), located in Salisbury, NC, is a 22,000 sq. ft. Class B multi-tenant office space in historic downtown Salisbury, NC. Constructed in the 1960s, on an approximately 2-acre site with a 2,500 sq.ft. outparcel, it underwent its most recent renovation in the early 2000s.
The prior owners focused on short-term returns employing a hands-off approach that generated quick rental revenues while severely limiting maintenance expenses. While this made for great income statements in the short term, this approach left the building needing significant and costly renovations to ensure it is a competitive investment property.
The new investor recognized that to generate quality long-term financial returns; he would need to focus on three key areas:
- Retaining and increasing the satisfaction of the current tenant
- Initiating and completing several extensive updates and repairs
- Identifying and implementing a strategic preventative maintenance plan
The Right Team
As an out-of-state investor, he knew it was essential to work with a local team that understood the property’s challenges, could manage renovations and updates, and had expertise in the local leasing market. After launching a search for a full-service property management and leasing team, the investor selected Price Commercial Management and Price Commercial Properties for their:
- Collaborative communication
- Market expertise
- High standards
- Attention to detail
Strategic Improvement
Together, the Price Management team and the investor established a plan that ensured the current tenants remained in place during renovations and upgrades. The Price team worked with tenant schedules to avoid interruptions in their daily operations. The first step in the process was improving facility cleanliness through contracting an initial deep clean and securing routine janitorial services focused on superior cleaning and hygiene.
Working with local providers, Price identified and prioritized the necessary renovations to address deferred maintenance and transform the facility into a successful investment property. These include:
- Concrete enhancements for sidewalks and entrances to bring up to code and eliminate possible trip hazards and the resulting liability
- Asphalt preventative maintenance in the parking lot (sealing and repairing cracks)
- Pavement remarking
- Proactive retaining wall repairs
- Functional roof and cosmetic ceiling repairs
- Interior and exterior LED lighting upgrades for cost savings and increased safety and security for tenants
- Landscaping for beautification and preventative maintenance
Reaching Potential
Employing a Value-Add investment strategy with local expertise, Price Commercial Management is ensuring this property reaches its client’s full investment potential. The investor has seen an increase in full-pay, on time tenants elevating the overall occupancy rate and desirability of the building with the help of the Price Commercial team.
